In a move that could redefine the financial sector landscape, Tata Capital is gearing up for one of the biggest initial public offerings (IPO) in India’s history. The financial services powerhouse has filed a confidential draft red herring prospectus (DRHP) for a staggering Rs 15,000 crore IPO, setting the stage for a monumental entrance into the stock market arena. According to The Economic Times, this IPO could be a game-changer for the industry.

Understanding the IPO Structure

This mega IPO includes both the issuance of new shares and a substantial offloading of shares by Tata Sons, which currently holds a dominant 93% equity stake in Tata Capital. With the regulatory nod from the Securities and Exchange Board of India (SEBI), this initial share sale marks a significant step in Tata Capital’s growth journey.

Tata Sons and the Upper Layer Designation

As designated by the Reserve Bank of India (RBI), Tata Sons and Tata Capital are considered upper-layer non-banking finance companies (NBFCs). This classification brings with it the mandate to list shares by September 2025. This IPO comes in alignment with these regulatory stipulations, positioning Tata Capital for long-term market integration and growth.

A Historic Public Debut

Should this IPO prove successful, it will join the ranks of Tata Group’s major public market debuts, second only to Tata Technologies, which made its public debut in November 2023. This is a monumental moment reflective of the group’s trust in India’s thriving financial sector.

Financial Growth and Performance

For the fiscal year 2024, Tata Capital recorded a remarkable revenue surge to Rs 18,178 crore, signaling a substantial 34% increase from the previous year. The company has demonstrated robust financial health, with its loan book exceeding Rs 1 lakh crore, growing 40% year-over-year, and reaching unprecedented profits of Rs 3,150 crore.

Diverse Financial Services Portfolio

Tata Capital continues to broaden its horizons, with subsidiaries cutting across commercial finance, consumer loans, and wealth service sectors. As a part of the financial juggernaut that is the Tata Group, the company stands poised to lead with innovative solutions and wide-reaching financial services.

An Exciting Step Forward

This colossal IPO not only signifies Tata Capital’s strategic expansion but also marks a high point in India’s financial markets. Investors and industry experts will be watching closely as Tata Capital embarks on this exciting new chapter, likely to influence the financial landscape for years to come.